Adolescence is a risk period for the onset of drug use, with more individuals initiating drug use during these years than any other time in life. In addition, those individuals who initiate drug use earlier in adolescence are at greater risk for developing drug abuse and dependence later in life. Adolescents are known to engage disproportionately in many types of risky behavior, such as reckless driving, illicit drug use, and unsafe sex. Research has aimed to determine whether the development of neural processing could lead to the post- adolescent drop in risk-taking behavior. While several studies have demonstrated shifts in reward sensitivity across adolescence, very little research has examined the development of sensitivity to punishment. Recent research has demonstrated behaviorally that the ability to learn from punishment continues to develop throughout adolescence. It is unclear, however, if this is because children and adolescents simply find negative events less aversive than adults, or if, instead, they find punishment equally unpleasant, but are unable to incorporate this information into a learning signal, known as a prediction error signal, that is necessary to learn to approach or avoid stimuli that have previously been rewarded or punished, respectively. The proposed study aims to dissociate between these two possibilities by having groups of children, adolescents, and young adults perform a valence-modulated probabilistic learning task in an MRI scanner, where they be rewarded for correct choices during one block, and punished for incorrect choices during another. BOLD response will be measured in a contrast of negative feedback vs. positive feedback and compared across age groups to determine developmental differences in overall response to punishment, and separately prediction error response to punishment will be measured. We predict that no age differences will emerge in the negative feedback vs. positive feedback contrast, but children and adolescents will show a diminished prediction error response relative to adults.